Green Shoots or Wishful Thinking plus PIMCO

I have spent the past few days getting prepared for our (Circle Financial Group’s) quarterly asset allocation meeting and have been trying to gather and digest information from some of the country’s leading investment thinkers. I can honestly say that in my now 21 years in the financial world, this moment is truly an exceptionally challenging time to come up with a long term investment strategy, with a mindful short term tactical bent. Arguably it was harder a few months back when everything seemed to be imploding, but even now there is still a tremendous amount of uncertainly about whether the massive government interventions will take effect, and at what long term cost. The economic news continues to be terrible, and these green shoots are truly small indeed. Everytime I look outside at my hydrangea plants, which currently look like a mass of dried out sticks ( see above) with a just a hint of green on a few stems, I think of our economy. I think of how last summer these plants were lush and full and vibrant, and now, well…. you get the picture. To carry on the analogy the Fed has certainly added a lot of fertilizer, but in order for plants to grow there also has to be water and sunlight. All three of these factors are relevant and likewise, many things have to be present for there to be meaningful econonomic stablity and growth. The Fed and the Treasury can do what they can do, but they can’t do everything that is needed to stop the decrease in housing and other asset values and stimulate demand in the global economy. Food for thought is always provided by our friends at PIMCO – read Bill Gross’s latest here. ( The Future of Investing: Evolution or Revolution?)